The increase in autism vs. increase in diagnosis is a hot debate. Actually, pretty much everything is a hot debate in the autism community...
I personally think there is some sort of genetic component and possibly an environmental component (a trigger?). Some think its vaccines, but my DD had signs well before most of her vaccines (I think there is a huge pile of them at 18 months, forgot now tho).
She has what they call non regressive autism, she was delayed from birth. Some kids are fine until age 2, then regress and lose language and other basic skills.